While installment loans are easier to get these days and can help you out of a financial bind, sometimes they come with too high of a cost. If you find yourself needing an installment loan, follow these tips to help you make it work out the best way possible for you.
Borrow only what you need
Installment loans may give you a longer time tp pay back the loan than a typical payday loan but it still has to be paid back. Don’t borrow any more money than you need. Sure, it would be nice to have a few extra dollars, but the interest that accrues on the loan is contingent upon how much you actually borrow. Plus, the more money you need to pay back, the more difficult it will be to do so.
Shop Around for Your Installment Loan: Comparing APRs
Comparison shopping is something that people do all of the time. They look at more than one house when buying a home, go to more than one car dealer when shopping a car, and try on more than one pair when buying shoes.
It only makes sense to shop around for the installment loan with the lowest annual percentage rate of interest.
This is also known as the APR, so it is easy to find. If you search for your installment lender online, you can easily compare several of them at the same time.
It’s important to use the amount of money that you need to borrow in order to make a good comparison. Lenders charge a number of different APRs, which are charged according to the actual sum of money that is borrowed.
Shop Around for Your Installment Loan: Comparing Fees
Many lenders charge additional fees on installment loans, and you’ll be expected to pay them. Try and find a lender who doesn’t charge any fees in order to avoid paying more than you should to get the money that you need.
Fees that you should look for include an application processing fee and service fees. It is possible to find a lender who doesn’t charge both of these, so it is worth the time that it takes to shop around. Typically, you’ll spend less than an hour online comparing lenders. If you can afford to wait that long, it is a good investment of your time since it can save you a few extra dollars on the cost of borrowing funds.
Making Sure That You Can Pay The Monthly Installments
Unless you want to incur additional fees on the day that your installment is due, make sure that you can pay it off in full. In addition to borrowing the least amount possible and finding the lowest interest rate and fees, you should do everything possible to ensure that you have the funds on the installment due dates. Avoid unnecessary expenditures, collect debts that people owe you, and even look underneath the seat cushions for spare change. If you want to make an installment loan work out in the best way possible for your circumstances, you need to work at it actively.